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Self-employed mortgage in Texas: qualify on bank statements, not tax returns

Yes. A bank statement loan qualifies you on deposits into your business or personal accounts, typically over 12 or 24 months, instead of the net income on your tax returns.

It is built for self-employed and 1099 borrowers whose write-offs make their tax return income look far smaller than what they actually earn. Available to self-employed buyers in Austin and Hays County, TX.

Typical timeline

Typically 30 to 45 days

Check my fit

Reviewed by Jennifer Ferrara, NMLS #2781982Last updated

What your bank statements prove

This is one of my favorite conversations, because the answer is so often yes when somebody has already been told no.

Your accountant did their job. They minimized your taxable income, which is what you pay them for. Then a traditional lender reads that same return, sees the net number, and treats you like you earn a fraction of what you actually bring in. That mismatch is a structuring problem, not a disqualification.

Bank statement programs look at what actually lands in your accounts. Twelve or twenty four months of deposits, an expense factor applied to reflect the cost of running your business, and that becomes your qualifying income. There are also asset-based options that qualify you on what you hold rather than what you earn, and profit-and-loss programs for certain business types.

Quick facts

Down payment
Typically 10% to 20%
Credit guidelines
Generally 640+
Typical timeline
Typically 30 to 45 days
Occupancy
Primary, second home, or investment

What it usually takes

  1. Usually two years self-employed in the same business, though there are exceptions
  2. 12 or 24 months of business or personal bank statements
  3. A larger down payment than a conventional loan typically wants
  4. A conversation about how your business is actually structured, that drives which program fits

Guidelines vary by lender, and I shop across more than 40 of them. Missing one of these is a reason to talk, not a reason to assume the answer is no.

See the estimated math

This is not a commitment to lend. All loans are subject to credit approval, income and property verification. Rates, terms, and programs are subject to change without notice. Nook Lending is powered by MPA Home Loans. Jennifer Ferrara, Loan Officer, NMLS #2781982. MPA Home Loans NMLS #2778343. Equal Housing Opportunity.

Is this loan right for you?

This fits if

1099 contractors, business owners, and anyone whose tax return understates what they really earn.

Pros

  • No tax returns required to qualify
  • Qualify on what actually lands in your accounts, not net income
  • 12 or 24-month statement options

Look elsewhere first if

If your tax returns already reflect your full income, Conventional will get you a better rate with less paperwork.

Cons

  • Larger down payment than a conventional W-2 loan
  • Rate typically a bit higher than conventional
  • Bank statements need to reasonably match the business type

About Self-Employed / Bank Statement

How do you get a mortgage in Texas if you are self-employed?

Most self-employed borrowers qualify through a bank statement program, which looks at 12 or 24 months of deposits into your business or personal accounts instead of the net income on your tax returns. Asset-based and profit-and-loss programs exist too, and which one fits depends on how your business is actually structured.

How many years of tax returns do I need in Texas if I am self-employed?

For a bank statement loan, none. That is the whole point of the program. Some self-employed borrowers still qualify better through a traditional program that does use tax returns, so we look at both before deciding which path actually gets you the better outcome.

What is a bank statement loan in Texas?

A bank statement loan qualifies you on what actually lands in your accounts, typically 12 or 24 months of deposits, rather than the net income your tax returns show after write offs. It is built specifically for self-employed and 1099 borrowers whose tax return income does not reflect what they really earn.

Worth comparing against

Very few situations have exactly one right answer. These are the ones that most often come up alongside this.

Related reading

Where this fits

Keep exploring

Wondering if Self-Employed / Bank Statement is right for you?

Send me the specifics and I will tell you what actually fits. If a different program serves you better, that is what I will say.

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